Hindustan Zinc Limited (“HZL” or the “Company”) today announced
results for the first quarter (“Q1”) ended 30 June 2012.
Highlights for the quarter
- Net profit up 6% to Rs. 1,581 Crore or
Rs. 3.74 per share
- Refined Lead and Silver production up
91% and 75% respectively
- Cash and cash equivalents of Rs. 19,404
Crore, as at 30 June 2012
“During the first quarter of FY 2013, we ramped up Sindesar
Khurd mine (SKM) resulting in a strong 70%+ increase in integrated
Lead and Silver production. Ore production at SKM has increased to
more than 1.5 times from a year ago. SKM’s steady ramp-up and low
cost of production reflect high mechanisation of our operations,
which will be emulated at all our future underground mining
projects”, said Mr. Agnivesh Agarwal, Chairman of Hindustan
Zinc.
Unaudited Financial Summary
(in Rs. Crore, except as stated)
Quarter Ended30 June
2,012 2,011 Change %
Net Sales/Income from operations Zinc
1,816
2,104 -14% Lead
342 255 34% Silver
388 309 26% Others
167 153 9%
Total 2,713 2,821 -4%
Cash Profit (Net Profit + Depreciation) 1,755 1,629
8%
Profit After Taxes 1,581 1,495 6%
Earnings Per Share (Rs.) 3.74 3.54 6%
Production - Mined Metal ('000 tonnes) Zinc & Lead
187 188 -1%
Production - Refined Metal ('000
tonnes) Total Zinc
161 193 -16% - Fully integrated Zinc
157 191 -18% Total Lead (1)
31 16 91% - Fully
integrated Lead
29 16 79% Total Silver (tonnes) (2)
82 47 75% - Fully integrated Silver (tonnes)
79 47
70%
Metal Prices and Exchange Rate Zinc LME (USD /
MT)
1,928 2,250 -14% Lead LME (USD / MT)
1,974 2,550
-23% Silver LBMA (USD / Oz)
28.3 38 -26% INR / USD
54.2 44.7 21%
(1) Including captive consumption of 1,641
tonnes in Q1 FY2013 vs. 1,391 tonnes in Q1 FY2012
(2) Including captive consumption of 8,643
kg in Q1 FY2013 vs. 7,196 kg in Q1 FY2012
(3) Silver occurs in Lead & Zinc ore
and is recovered in the smelting and silver-refining processes
Operational Performance
Mined metal production during the quarter was in line with
current year’s mine plan at 187,000 tonnes, compared to 188,000
tonnes in the corresponding prior quarter. Mined metal output at
Sindesar Khurd mine increased by around 60% from a year ago,
offsetting lower output from Rampura Agucha mine. In line with the
mine plan and as announced earlier, production in H1 FY2013 is
expected to be marginally lower than H1 FY2012, but will be more
than made up in H2 FY2013.
Refined Lead production and refined Silver production in Q1
FY2013 increased by 91% and 75% from a year ago, to 31,000 tonnes
and 82 tonnes respectively. The increase was primarily due to
ramp-up of SK mine and stabilization of the new Lead & Silver
refining capacities. Refined Zinc production was 161,000 tonnes, in
line with the anticipated mine production and our guidance.
Financial Performance
Revenues for Q1 FY2013 were Rs. 2,713 Crore, down 4% compared to
the corresponding prior quarter. During the quarter, the positive
impact of higher Lead-Silver volumes and Rupee depreciation was
offset by lower Zinc volume, LME prices of Zinc & Lead and LBMA
price of Silver. Net profit for the quarter was up 6% at Rs. 1,581
Crore, compared to the corresponding prior quarter.
The Zinc COP, excluding royalty, during the quarter was Rs.
45,759 per MT ($844), compared to Rs. 39,117 ($874) in the
corresponding prior quarter. The increase was due to higher prices
of consumables due to Rupee depreciation and lower metal
production.
Expansion Projects
During the first quarter of FY 2013 we continued to invest in
our mining assets achieving significant progress in the underground
mine development at Rampura Agucha and are progressing well in
Kayar mine development. We expect developmental ore from RA
underground mine and Kayar mine in the second half of FY2013.
Commercial production from both these mines will start next
year.
We are in the final stages of developing technical feasibility
of our next phase of expansions.
Liquidity and investment
As at 30 June 2012, the Company had cash and cash equivalents of
Rs. 19,404 Crore. This includes Rs. 10,540 Crore in debt mutual
funds, Rs. 1,540 in bonds and Rs. 7,310 Crore in fixed deposits
with banks. The Company follows a conservative investment policy
and invests in high quality debt instruments. All mutual fund
investments are based on advice from CRISIL.
About Hindustan Zinc
HZL is one of the world’s largest integrated producers of
Zinc-Lead and a leading producer of Silver globally. It has a metal
production capacity of over one million tonnes per annum with its
key Lead-Zinc mines in Rampura Agucha and Sindesar Khurd; and
modern smelting complexes in Chanderiya and Dariba. HZL is focused
on growth and long-term term sustainability on the back of its
high-quality assets, long mine life of over 25 years and low cost
base. The Company is a subsidiary of the NYSE listed, Sterlite
Industries (India) Limited (NYSE: SLT) and London listed FTSE 100
diversified metals and mining major, Vedanta Resources plc.
Disclaimer
This press release contains “forward-looking statements” – that
is, statements related to future, not past, events. In this
context, forward-looking statements often address our expected
future business and financial performance, and often contain words
such as “expects,” “anticipates,” “intends,” “plans,” “believes,”
“seeks,” “should” or “will.” Forward–looking statements by their
nature address matters that are, to different degrees, uncertain.
For us, uncertainties arise from the behavior of financial and
metals markets including the London Metal Exchange, fluctuations in
interest and or exchange rates and metal prices; from future
integration of acquired businesses; and from numerous other matters
of national, regional and global scale, including those of a
political, economic, business, competitive or regulatory nature.
These uncertainties may cause our actual future results to be
materially different than those expressed in our forward-looking
statements. We do not undertake to update our forward-looking
statements.
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